Goldman building robo-adviser to give investment advice to the masses

A
sign is displayed in the reception of Goldman Sachs in
SydneyThomson
Reuters

(Reuters) - Goldman Sachs Group Inc , known for advising the
world's richest and most powerful, is building a so-called
robo-adviser geared to mass affluent customers, according to a
job listing posted Monday on the bank's website.

A Goldman spokesman declined to comment.

The job posting for employees to help build the
platform(http://www.goldmansachs.com/a/data/jobs/46404.html)
comes as Goldman is looking at ways to broaden its customer base
outside the super wealthy, including making deeper inroads into
new consumer-focused businesses.

The bank last year launched Marcus, its first major foray into
consumer lending, as well as a complementary deposit-taking
platform after acquiring GE Capital's online bank. It also
acquired Honest Dollar, an online retirement savings platform for
small businesses and startups.

The robo platform would sit within the bank's rapidly growing
investment management division, according to the ad. The unit,
which Goldman has been trying to build out in recent years to
diversify its revenue, posted a record $1.38 trillion in assets
under supervision at the end of 2016.

Goldman has for years grappled with how to tap into the mass
affluent segment, broadly defined as those with less than $1
million in investable assets, without diluting the brand of its
private wealth business which is considered a jewel within the
bank, according to people familiar with the matter. Goldman's
U.S. private wealth business typically advises clients with an
account size of around $50 million.

Goldman has in the past considered expanding Ayco, a wealth
advisory firm it purchased in 2003, as a way to push more deeply
into the mass affluent segment, the people added.

While the robo-advice market was initially developed by startups
such as Wealthfront and Betterment with ambitions of upending the
traditional financial advice sector, large firms such as Charles
Schwab Corp and Vanguard have launched similar services.

Morgan Stanley is launching its own robo-advisor later this year,
primarily for the children of its existing clients. CEO James
Gorman has said that firms which combine digital and human advice
will be more successful in the future.

(Reporting by Olivia Oran; additional reporting by Anna Irrera in
New York; Editing by Cynthia Osterman)